That Elusive Elasticity: A Long-Panel Approach To Estimating The Price Sensitivity Of Business Capital

The sensitivity of business capital formation to its user cost plays a key role in the analysis of many economic issues. Although this elasticity has been the subject of an enormous number of studies, a consensus remains elusive. We develop an estimation strategy that exploits panel data in an original way and avoids several pitfalls - difficult-to-specify dynamics, transitory time-series variation, and positively sloped supply schedules - inherent in investment equations that can bias the estimated elasticity. Results are based on an extensive panel containing 1,860 manufacturing and non-manufacturing firms. Our model generates a precisely estimated user cost elasticity of approximately 0.40. The method developed here may prove useful in estimating other structural parameters from panel datasets.

That Elusive Elasticity: A Long-Panel Approach to Estimating the Capital-Labor Substitution Elasticity

The elasticity of substitution between capital and labor features prominently in several areas of economic research. However, a consensus estimate remains elusive. We develop an estimation strategy that filters panel data in an original way and avoids several pitfalls - difficult-to-specify dynamics, transitory time-series variation, and positively sloped supply schedules - inherent in investment equations that can bias the estimated elasticity. Results are based on an extensive panel containing 1,860 manufacturing and non-manufacturing firms. Our model generates a precisely estimated elasticity of approximately 0.40. The method developed here may prove useful in estimating other structural parameters from panel datasets.

Identità organizzativa, identità individuale e transformazione

This book chapter (in Italian ) contributes to the study of people identifying as gender non-conforming in the workplace from an organizational and psychological. In particular, we focus on the interplay between gender identity, organizational identity and individual identity

License prices for financially constrained firms

It is often alleged that high auction prices inhibit service deployment. We investigate this claim under the extreme case of financially constrained bidders. If demand is just slightly elastic, auctions maximize consumer surplus if consumer surplus is a convex function of quantity (a common assumption), or if consumer surplus is concave and the proportion of expenditure spent on deployment is greater than one over the elasticity of demand. The latter condition appears to be true for most of the large telecom auctions in the US and Europe. Thus, even if high auction prices inhibit service deployment, auctions appear to be optimal from the consumers’ point of view

The effects of financialisation and financial development on investment: Evidence from firm-level data in Europe

In this paper we estimate the effects of financialization on physical investment in selected western European countries using panel data based on the balance-sheets of publicly listed non-financial companies (NFCs) supplied by Worldscope for the period 1995-2015. We find robust evidence of an adverse effect of both financial payments (interests and dividends) and financial incomes on investment in fixed assets by the NFCs. This finding is robust for both the pool of all Western European firms and single country estimations. The negative impacts of financial incomes are non-linear with respect to the companies’ size: financial incomes crowd-out investment in large companies, and have a positive effect on the investment of only small, relatively more credit-constrained companies. Moreover, we find that a higher degree of financial development is associated with a stronger negative effect of financial incomes on companies’ investment. This finding challenges the common wisdom on ‘finance-growth nexus’. Our findings support the ‘financialization thesis’ that the increasing orientation of the non-financial sector towards financial activities is ultimately leading to lower physical investment, hence to stagnant or fragile growth, as well as long term stagnation in productivity

What Do Micro Data Reveal About the User Cost Elasticity?: New Evidence on the Responsiveness of Business Capital Formation

The price sensitivity of business investment spending is a central element in economic analysis. A substantial response of capital spending to its user cost, which combines interest, tax, and depreciation rates with relative prices, is critical to evaluating the effectiveness of monetary policy, deficit reduction, and tax reform. In spite of this central role, however, the supporting evidence for a substantial user cost elasticity (UCE) is modest. Several important concerns suggest a downward bias in elasticities estimated from the aggregate data typically employed in UCE research. These biases may arise from firm heterogeneity, measurement error, capital market frictions, and simultaneity. While such biases are theoretically plausible, their empirical importance remains to be substantiated. With a particularly rich data set, containing over 26,000 observations, this paper explores what can be learned about the UCE from micro data. Investment and firm-level control variables are taken from an extensive panel of Compustrat forms. To construct the user cost, we tap a new data source that provides variation across firms as well as across time. A number of the econometric biases mentioned above have a substantial impact on the estimated UCE. After correcting for the biases, we obtain a precisely estimated but small value for the UCE of about -0.25. The effects of capital gain tax cuts and the "flat-tax" proposal on investment are evaluated with this estimated UCE.

P2396Stress computed tomographic perfusion improve diagnostic accuracy of coronary computed tomographic angiography in intermediate to high risk patients for coronary artery disease

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Parkinson's disease recovery by GM1 oligosaccharide treatment in the B4galnt1+/- mouse model

Given the recent in vitro discovery that the free soluble oligosaccharide of GM1 is the bioactive portion of GM1 for neurotrophic functions, we investigated its therapeutic potential in the B4galnt1+/- mice, a model of sporadic Parkinson's disease. We found that the GM1 oligosaccharide, systemically administered, reaches the brain and completely rescues the physical symptoms, reduces the abnormal nigral \u3b1-synuclein content, restores nigral tyrosine hydroxylase expression and striatal neurotransmitter levels, overlapping the wild-type condition. Thus, this study supports the idea that the Parkinson's phenotype expressed by the B4galnt1+/- mice is due to a reduced level of neuronal ganglioside content and lack of interactions between the oligosaccharide portion of GM1 with specific membrane proteins. It also points to the therapeutic potential of the GM1 oligosaccharide for treatment of sporadic Parkinson's disease